Shipping companies listed in Hong Kong and the Chinese mainland closed higher on Monday, as the industry is expected to remain promising during the second quarter due to rising global shipping rates and the country's soaring exports.
COSCO Shipping Holdings Co gained 5.95 percent to HK$17.10 ($2.20), Orient Overseas (International) was up 4.03 percent to HK$124.00 and Shanghai-listed Ningbo Marine Co rose 3.92 percent to 5.30 yuan ($0.82).
Han Jun, an analyst with Beijing-based China Securities Co, noted in a research note on Sunday that shipping rates are rising all over the world, due to the lingering effect of the Suez Canal block.
The Ningbo containerized freight index - which reflects international container shipping rates - reached a record high of 2,828.31 on Friday.
Rates for routes serving North America are being driven up by a dry season for the Panama Canal, media reports said.
Han predicted that COSCO Shipping Holdings will report second-quarter net profit exceeding 20 billion yuan.
The company reported first-quarter net profit of 15.45 billion yuan, up 52 times year-on-year, according to a stock exchange filing.
Another factor is a rise in export orders for China, the world's factory, as the coronavirus rages in other major Asian economies like India, worsening the shortage of shipping capacity.
Latest customs data showed that China's export growth beat market expectations to gain 32.3 percent year-on-year to hit $263.92 billion in April, while imports for the month rose 43.1 percent year-on-year, underscoring China's sustained robust economic activity.
Fu Linghui, a spokesperson of the National Bureau of Statistics, said on Monday that China's foreign trade will keep growing for the rest of the year.
Although the COVID-19 outbreak worsened in some countries recently, the global economic recovery will undoubtedly continue and support demand, Fu said.
He said that China's manufacturing recovery is able to effectively meet changes in external demand, while the nation's opening-up moves and policies to support foreign trade will continue to play their roles.
Source: Global Times
The opinions expressed herein are the author's and not necessarily those of The Xinde Marine News.
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